IDEAS home Printed from https://ideas.repec.org/p/ces/ceswps/_285.html
   My bibliography  Save this paper

Pareto-Improving Intergenerational Transfers

Author

Listed:
  • Berthold U. Wigger

Abstract

In the presence of endogenous growth intergenerational transfer from the young to the old reduce per capita income growth and harm future generations. On the other hand, competitive equilibria are inefficient if externalities sustain long-run growth. This paper shows that if individuals retire in the last period of their life, the inefficiency of the market economy can be removed by an investment subsidy without making the current or future generations worse off only if coupled with intergenerational transfers from the young to the old.

Suggested Citation

  • Berthold U. Wigger, 2000. "Pareto-Improving Intergenerational Transfers," CESifo Working Paper Series 285, CESifo.
    • Handle: RePEc:ces:ceswps:_285
    as

    Download full text from publisher

    File URL: https://www.cesifo.org/DocDL/cesifo_wp285.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Romer, Paul M, 1986. "Increasing Returns and Long-run Growth," Journal of Political Economy, University of Chicago Press, vol. 94(5), pages 1002-1037, October.
    2. Pascal Belan & Philippe Michel & Pierre Pestieau, 1998. "Pareto-Improving Social Security Reform," The Geneva Risk and Insurance Review, Palgrave Macmillan;International Association for the Study of Insurance Economics (The Geneva Association), vol. 23(2), pages 119-125, December.
    3. Gilles Saint-Paul, 1992. "Fiscal Policy in an Endogenous Growth Model," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(4), pages 1243-1259.
    4. Jappelli, Tullio & Pagano, Marco, 1999. "The Welfare Effects of Liquidity Constraints," Oxford Economic Papers, Oxford University Press, vol. 51(3), pages 410-430, July.
    5. Boldrin, Michele, 1992. "Dynamic externalities, multiple equilibria, and growth," Journal of Economic Theory, Elsevier, vol. 58(2), pages 198-218, December.
    6. Jones, Larry E. & Manuelli, Rodolfo E., 1992. "Finite lifetimes and growth," Journal of Economic Theory, Elsevier, vol. 58(2), pages 171-197, December.
    7. Grossman, Gene M. & Yanagawa, Noriyuki, 1993. "Asset bubbles and endogenous growth," Journal of Monetary Economics, Elsevier, vol. 31(1), pages 3-19, February.
    8. K. J. Arrow, 1971. "The Economic Implications of Learning by Doing," Palgrave Macmillan Books, in: F. H. Hahn (ed.), Readings in the Theory of Growth, chapter 11, pages 131-149, Palgrave Macmillan.
    9. King, Ian & Ferguson, Don, 1993. "Dynamic inefficiency, endogenous growth, and Ponzi games," Journal of Monetary Economics, Elsevier, vol. 32(1), pages 79-104, August.
    10. Costas Azariadis & Allan Drazen, 1990. "Threshold Externalities in Economic Development," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 105(2), pages 501-526.
    11. Romer, Paul M, 1987. "Growth Based on Increasing Returns Due to Specialization," American Economic Review, American Economic Association, vol. 77(2), pages 56-62, May.
    12. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Tabata, Ken, 2024. "Redistributive policy and R&D-based growth," Journal of Macroeconomics, Elsevier, vol. 79(C).
    2. Andreas Irmen & Berthold U. Wigger, 2002. "Trade Union Objectives and Economic Growth," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 59(1), pages 49-67, February.
    3. Kolmar, Martin & Meier, Volker, 2012. "Intragenerational externalities and intergenerational transfers," Journal of Pension Economics and Finance, Cambridge University Press, vol. 11(4), pages 531-548, October.
    4. Berthold Wigger, 2005. "Public Debt, Human Capital Formation, and Dynamic Inefficiency," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 12(1), pages 47-59, January.
    5. Berthold U. Wigger, 2001. "Higher Education Financing and Income Redistribution," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 58(1), pages 48-59, December.
    6. Weizsäcker, Robert K. von & Wigger, Berthold U., 2001. "Rentenfinanzierung und intergenerationelle Gerechtigkeit : Eine wachstumstheoretische Perspektive," Discussion Papers 606, Institut fuer Volkswirtschaftslehre und Statistik, Abteilung fuer Volkswirtschaftslehre.
    7. Kaas, Leo, 2003. "Productive government spending, growth, and sequential voting," European Journal of Political Economy, Elsevier, vol. 19(2), pages 227-246, June.
    8. Yew, Siew Ling & Zhang, Jie, 2013. "Socially optimal social security and education subsidization in a dynastic model with human capital externalities, fertility and endogenous growth," Journal of Economic Dynamics and Control, Elsevier, vol. 37(1), pages 154-175.
    9. Berthold U. Wigger & Robert K. von Weizs?cker, 2001. "Risk, Resources, and Education: Public Versus Private Financing of Higher Education," IMF Staff Papers, Palgrave Macmillan, vol. 48(3), pages 1-6.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Weizsäcker, Robert K. von & Wigger, Berthold U., 2001. "Rentenfinanzierung und intergenerationelle Gerechtigkeit : Eine wachstumstheoretische Perspektive," Discussion Papers 606, Institut fuer Volkswirtschaftslehre und Statistik, Abteilung fuer Volkswirtschaftslehre.
    2. Jones, Larry E. & Manuelli, Rodolfo E., 1997. "The sources of growth," Journal of Economic Dynamics and Control, Elsevier, vol. 21(1), pages 75-114, January.
    3. Azariadis, Costas & Reichlin, Pietro, 1996. "Increasing returns and crowding out," Journal of Economic Dynamics and Control, Elsevier, vol. 20(5), pages 847-877, May.
    4. Berthold Wigger, 2005. "Public Debt, Human Capital Formation, and Dynamic Inefficiency," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 12(1), pages 47-59, January.
    5. Berthold U. Wigger, 2002. "Social Security and Growth in an Altruistic Economy," German Economic Review, Verein für Socialpolitik, vol. 3(1), pages 53-80, February.
    6. Berthold U. Wigger, 1999. "Public Pensions and Growth," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 56(2), pages 241-241, June.
    7. Wigger, Berthold U., 1999. "Alterssicherung und Wachstum," Discussion Papers 569, Institut fuer Volkswirtschaftslehre und Statistik, Abteilung fuer Volkswirtschaftslehre.
    8. Jianjun Miao & PENGFEI WANG, 2011. "Sectoral Bubbles and Endogenous Growth," Boston University - Department of Economics - Working Papers Series WP2011-032, Boston University - Department of Economics.
    9. Miao, Jianjun & Wang, Pengfei, 2014. "Sectoral bubbles, misallocation, and endogenous growth," Journal of Mathematical Economics, Elsevier, vol. 53(C), pages 153-163.
    10. Frédéric Lordon, 1991. "Théorie de la croissance : quelques développements récents [Deuxième partie : la redécouverte des rendements croissants]," Revue de l'OFCE, Programme National Persée, vol. 37(1), pages 191-243.
    11. Helpman, Elhanan, 1992. "Endogenous macroeconomic growth theory," European Economic Review, Elsevier, vol. 36(2-3), pages 237-267, April.
    12. Todd Smith, R., 1996. "Money, taxes, and endogenous growth," Journal of Macroeconomics, Elsevier, vol. 18(3), pages 449-462.
    13. Long, N.V. & Wong, K.Y., 1996. "Endogenous Growth and International Trade: A Survey," Working Papers 96-07, University of Washington, Department of Economics.
    14. Hollanders, Hugo & Weel, Bas ter, 1999. "Skill-Biased Technical Change: On Endogenous Growth, Wage Inequality and Government Intervention," Research Memorandum 013, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
    15. Wigger, Berthold U., 2001. "Gifts, Bequests, and Growth," Journal of Macroeconomics, Elsevier, vol. 23(1), pages 121-129, January.
    16. Kevin J. Lansing, 2008. "Speculative growth and overreaction to technology shocks," Working Paper Series 2008-08, Federal Reserve Bank of San Francisco.
    17. Lansing, Kevin J., 2012. "Speculative growth, overreaction, and the welfare cost of technology-driven bubbles," Journal of Economic Behavior & Organization, Elsevier, vol. 83(3), pages 461-483.
    18. Stolpe, Michael, 1992. "Ansätze der neuen Wachstumstheorie: ein Literaturüberblick," Kiel Working Papers 508, Kiel Institute for the World Economy (IfW Kiel).
    19. Xiaopeng Yin, 2014. "Externalities, Productivity and Sustained Growth," Review of Development Economics, Wiley Blackwell, vol. 18(3), pages 543-563, August.
    20. Xavier Sala-i-Martin, 1990. "Lecture Notes on Economic Growth(I): Introduction to the Literature and Neoclassical Models," NBER Working Papers 3563, National Bureau of Economic Research, Inc.

    More about this item

    Keywords

    Intergenerational transfers; externalities; endogenous growth;
    All these keywords.

    JEL classification:

    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ces:ceswps:_285. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Klaus Wohlrabe (email available below). General contact details of provider: https://edirc.repec.org/data/cesifde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.